Rangebound movement likely

WEEKLY TECHNICAL ANALYSIS

The markets ended on a positive note for the fourth straight week despite a rate hike by the RBI. The Sensex bounced back smartly by 955 points, from a low of 13,727 to a high of 14,683, before settling at 14,657 - up 382 points for the week ended August 1. It has now gained 1,203 points in the last four weeks.

The new Sensex entrant Tata Power was the top gainer, up 10 per cent. Tata Steel too surged 10 per cent. HDFC, Reliance, Wipro, BHEL, DLF, Ranbaxy and Infosys rallied 6-8 per cent each. On the other hand, Reliance Communications slumped 13 per cent. Maruti, Tata Motors, Hindalco and NTPC dropped 6-9 per cent each.
 

KEY LEVELS
	Sensex	Nifty
S3	14065	4250
S2	14180	4280
S1	14290	4315
Close	14657	4414
R1	15025	4515
R2	15135	4545
R3	15250	4575
S-Support level  R-Resistance level

The Sensex is likely to trade in a broad range of 13,350-15,200.

An upmove beyond 15,200 could see the index rally up to 17,000, while break of 13,350 on the downside could see the index retest its low of 12,500. It is likely to face support around 14,290-14,180-14,065 and resistance around 15,025-15,135-15,2450 this week.

The Nifty logged smart gains of 102 points last week. It ended firmly at 4,414 after gyrating over 260 points.

The Nifty is trading above its short-term and mid-term moving averages, which is a positive sign.

The short-term (20 days) average is 4,67 and the mid-term (50 days) average is 4,348. The long-term (200 days) moving average is 5,129. The index may face resistance around its recent high of 4,539 and spurt to 4,600 thereafter.